Combined rate and how to defer it in Delaware.
Delaware may have no sales tax, but its 6.60% income tax rate on capital gains pushes the combined figure for investment property to 30.4% (20% federal + 3.8% NIIT + 6.60% state).
Delaware taxes capital gains as ordinary income at up to 6.60%, on top of the federal bill. See the full estimate including depreciation recapture in the capital gains tax calculator.
A 1031 like-kind exchange can defer the full 30.4% combined rate by reinvesting into a replacement property. Model the numbers in the 1031 exchange calculator and check your deadlines with the timeline calculator.